How Do You Calculate Wages for ESI and EPF When There's a Leave Without Pay?

Hi seniors,

I need your help regarding the calculation of wages for ESI and EPF. Let's assume Mr. X's monthly salary is 6000 PM, including basic plus DA for PF purposes. However, in the month of December, Mr. X took one leave (LOP). Please clarify how the wages for LOP will be calculated, whether it will be 6000/31*1, 6000/30*1, or 6000/26*1.

Also, please clarify if the same formula will be applicable in the case of ESI.

Regards,
Rachna Mittal

Depends on company policy, if Sunday is a paid weekly leave, then 30 (in salary calculation, it's always calendar days). However, where wages are paid on daily wages, on a no work, no pay basis, the 26 days or 25 days formula is applied (mostly in the case of factory workers).

Sir,

We are paying wages to workers on a monthly basis; however, Sunday is the paid weekly off. Please clarify in this scenario whether wages, say 6000 PM, shall be divided by 30 days or 26 days.

i.e. 6000/30 days * 1 (LOP) or 6000/26 days * 1 (LOP).

Please clarify....

For all the working days or worked days, the PF is to be paid. However, the standard policy is followed as per the PF authority. When calculating the month, it always excludes the weekly off.

PF is to be calculated on the monthly sum of basic & DA actually payable for the month and deducted accordingly from total wages.

ESI is to be treated the same way but on gross wages. Don't complicate the simple method.